Does a guarantee provide the reassurance its name implies? When a transaction goes wrong, the injured party may have the benefit of a bank guarantee. It could be excused for thinking that its losses will be covered, to the extent of that guarantee. However, in these tough economic times, banks and financial institutions are carefully scrutinising the terms of their guarantees and may seek to deploy a variety of arguments for refusing to be bound by them.
Earlier this year I looked at claiming interest in adjudication proceedings under the Late Payment of Commercial (Interest) Act 1998, in particular the exercise of my discretion under section 5. Recently the TCC was asked (in Partner Projects v Corinthian Nominees) a similar question about whether an adjudicator had jurisdiction to award interest under the LPA.
An employer, such as a property developer, may need to involve a contractor in a project before it is ready to sign a building contract. This is sometimes generically known as early contractor involvement (ECI), and can take place on a formal or informal basis. Two common types of agreement between an employer and a contractor in these circumstances are a letter of intent and a pre-construction services agreement (PCSA). (Occasionally, a PCSA is known by the even shorter acronym: PCA, for pre-construction agreement.)
Slade’s Merry Christmas Everybody:
“So here it is merry Christmas, everybody’s having fun.
Look to the future now, It’s only just begun.”
Following business as usual this week, PLC Construction will send its last e-mail of 2011 next week, to arrive in your inbox on Thursday 22 December 2011. We are then taking a break until the new year.
The first e-mail of 2011 will be sent to arrive in your inbox on Thursday 5 January 2012. This e-mail will include reports of all developments since 22 December 2011.
Merry Christmas and a happy new year.
I was surprised at the Court of Appeal’s recent decision in Daventry District Council v Daventry & District Housing Ltd. To me, this seems at odds with what I thought were the well-established rules of contract interpretation and rectification.
Well, Christmas is almost upon us and the television is already full of adverts of what we can look forward to watching over the festive period. As well as another heart-stopping instalment of Downton Abbey, I’m rather hoping A Christmas Carol will be on (the Muppets version obviously).
Rather like Ebenezer Scrooge in the Dickens classic, I can’t help thinking that some of the parties who end up in serial adjudications, which are followed by enforcements in the TCC, appeals, deals, etc, are haunted by the “Ghost of Adjudications Past”, or perhaps wish that they had been visited by the “Ghost of Adjudications Yet to Come” at the outset of their disputes, or even before they entered into the contract! One such set of parties might be those involved in PPL v Corinthian Nominees. Continue reading
Percy Bysshe Shelley, Hymn to intellectual beauty:
“There is a harmony in autumn, and a lustre in its sky, which through the summer is not heard or seen, as if it could not be, as if it had not been!”
As November ends, so does autumn. The days are getting shorter and the nights are lengthening as the winter solstice draws near. For some of us (in the south east at least), it hasn’t always felt like winter was on our doorstep, with one of the warmest and driest Novembers on record, and many leaves still clinging to the trees. Continue reading
These are tough times for the construction industry. The OECD has just announced that the UK is heading back into recession. Big deal – the construction industry has never got out of one that started in 2008 when Lehman Brothers fell over. The Chancellor’s announcement of an extra £30billion for infrastructure is obviously welcome, but it will take some time to materialise – and only then if he can convince the pension funds to stump up the cash.
Regular readers of this column will note that I have, on numerous occasions over the last three years, set out my views on an adjudicator’s actions (whether in terms of what they have or have not done, or have or have not decided). Well this post is no different.
Just a few weeks ago I wrote about why I thought it was fair that adjudicators should get paid, even when their decisions were unenforceable. I know not everyone shares that view and after receiving some well-made responses to my post, I’m now wondering whether I should clarify it and say “yes, but…” in true lawyer style, since I’m beginning to think that, like all things, there must be exceptions to that rule. The judgment in Carillion v Smith also interested me and, in particular the timing of the decision in the context of a Part 8 application. Continue reading
This post uses a recent case to consider whether a draft collateral warranty, signed as a deed, can be used by an employer in place of a formal engrossment. Can an employer complete the missing details and use the collateral warranty to give rights to a beneficiary? Might a contractor be able to stop the employer using and relying on that executed draft? Continue reading